Onus on Modi to meet corporates’ soaring expectations

Narendra Modi who steered his party, the Bhartiya Janata Party, to a thumping victory in the parliamentary elections and placed the National Democratic Alliance back in power, now faces the real test of his ability to deliver (See: Modi emerges stronger as BJP secures 284 seats).

The man who fought the elections on the plank of change now faces the onerous task of fulfilling the wishes of business and industry that include growth boosters, reining in inflation, faster project clearance and reversal of Land Acquisition Act.

"A clear mandate is positive for India. FICCI hopes that this mandate will help the leadership restore much needed investor confidence, attract higher investments and generate employment, especially in the manufacturing sector," FICCI president Sidharth Birla said on Friday.

The nation needs minimum government and maximum governance, Birla said, adding, "Industry must be seen as a key factor in the nation's advancement by enabling efficient provision of goods and services and creation of jobs."

"A majority mandate gives hope of a stable government, paving the way for bold and decisive policy reforms. This can herald a sustainable 10 per cent growth of the economy in the next 18-24 months," Assocham president Rana Kapoor said.

"Manufacturing sector reforms should be at the top of the agenda of the new government to enhance its growth and productivity to generate millions of employment opportunities in the economy," PHD Chamber of Commerce president Sharad Jaipuria said.

Engineering Export Promotion Council (EEPC) Chairman Anupam Shah said the "Modi government will be able to take some bold decision regarding labour reforms and create new employment".

Bharti Axa Life Insurance CEO Sandeep Ghosh said a strong government will help in pushing through long pending policy decisions around FDI, taxation and long-term investments.

It was not just industry that wanted a change of guard at the centre, there was an overwhelming desire among India's 300 million-strong middle class for change, that a dark chapter of corruption and nepotism of a stubborn ruling class came to an end.

In some ways it was not a Modi wave that decimated the congress to a position below the rank of Opposition party in parliament with just 44 seats, far short of the 55 seats required.

Modi, has now donned the cap of an economic reformer rather than a Hindu nationalist, and has denied allegations that he failed to stop Hindu mobs that went on a rampage of revenge after some Muslims torched a train carrying Hindu pilgrims in 2002.

He has denied the allegations and a Supreme Court ordered inquiry absolved him of responsibility.

Since Modi took control in 2001, Gujarat has led the nation in GDP growth. It accounts for 16 per cent of industrial output and 22 per cent of exports, despite having 5 per cent of its population.

Under his stewardship, farmers and industry have been assured uninterrupted power, albeit at high rates, and bureaucratic controls slashed.

Gujarat has some of the fines highways of India and its ports are among the busiest.

Gujarat has been often compared with the Guangdong province that spearheaded China's economic revival.

A central government-ordered study last month said it had the best land acquisition policies in place, among all of India's 29 states in terms of ease of doing business.

Land disputes have been the single biggest hurdle holding up 90 per cent of infrastructure projects around the country.

But replicating Gujarat's success on a national scale presents significant challenges in a country with a complex federal structure and various power centers across various states and a bureaucracy still not out of red-tapism.

Modi also faces the more important task of creating 10 million jobs a year, four times the pace of the last 5 years, to absorb youth into the workforce and bridging the growing gap between rich and poor among its 1.2 billion people.